The Capacity Planning And Control Business Essay


In business organization, every department has its own significance and role to make it successful. Every department has its own importance and not a single department can be declared as a imperative life of company. it is the joint effort of all the department to make any business successful.

Marketing, Sales, Human Resources, Information Technology, Distribution, research and Development and Customer services are mainly the very important function of any organization especially in this century or era. No one can declare from all of these mention department are sole responsible for the organization or corporate success. Every department has its own responsibilities and unique characteristics which guided the department to make it more vital. However, there is a department which is in coordination with the entire remaining department or studies say that it is a launch pad of the entire above mentions department and that particular department is called as Operation.

No matter, what is the function of the department; there will be a guideline and system available to make it work flow properly. Operation is the backbone of any organization, whichever organization or business we select operations play a very important or vital role to make it efficient and successful. Operations management not just make it efficient but also help in getting smooth workflow and create a link between all the departments of the organization. The success of any business is mainly depends on the process and the strategic planning’s.

Organizations goals must be achieved by the effective and useful operation management. Now, we can easily say that operation management ensures the life of the company and play a very vital role in any organization. This work is done for TESCO operation management mechanism. And in this assignment will discuss the operation management, operation function, management function, performances and strategies used by Tesco, product and service design, planning and controlling, inventory and material management, supply chain management, quality management and project management of TESCO

TESCO Company Overview:

In 1919 Jack Cohen started selling groceries in east London market at stall. After 10 years 1929 he established first Tesco at Burnt Oak, Edgware, North London. And just after 3 year he expands Tesco as private limited company. In 1961 one of the Tesco stores at Leicester declared as Europe largest store. In 1974 Tesco opened his first petrol station. In 1983 Tesco pvt ltd has become Tesco PLC. In 1990, Tesco started expending worldwide. Tesco express was established in 1994 Tesco express known traditional supermarket in residential areas (Tesco History, 2013)

Tesco is operating in more than 12 countries worldwide. It is a leading superstore company in UK more than 6700 stores is in operation worlwide in which different type of items are available for customers such as food, drink clothes, electronics items, insurances, mortgages, home appliances, medicines, and telecommunication services.etc. More than 520,000 employees are working in Tesco worldwide. (Tesco business, 2013)

Operations Management:

Operation management is defining as the effective planning, organizing and control of all the resources and activities necessary to provide the market with tangible goods and services. (Waller, 1999)

Operation activities are vast and apply to manufacturing industries, and services firms, in the private sector as well as to non profit organization and even government

Operation Management has two scope

Company aspect

Customer aspect

Company Aspect

The operation management for the company is to deal with the operation in a cost effective, efficient and in a less costly way.

Customer aspect

Customer aspect is to require a superior quality of the manufactured goods and services.

Now, business operation require to be fulfil not only its own requirement but also the customers demand

OPERATIONS FUNCTION: - "of the organisation concerns with the process of transforming input resources into useful outputs and thereby adding value to some entity; this constitutes the primary and central function of virtually every organisation." (N Slack, S Chambers and R Johnston operation management, 6th Ed)

In simple words, we can say that the purpose of the operations Function is to smooth flow of process to convert input into requiring output, in a cost effective way (Operations_Management)

Tesco operation function is to control the men power, Material, Machines, Capital and information. Transformed them in term of product design, process planning and production control and give output in term of product and services. An example of the transformational model in used in Tesco is given below.


Men Power, Material, Machine, Capital, Information


Product & services

Transformed Process

Product Design, Process Planning, production Control, Maintainance


Inventory, Quality, Cost

The primary aim of the operations management departments challenge to create the required balance between the costs and revenue to get the highest net operational profit, but at the same time to guarantee the quality of the product and service. Operations management includes the performance that are involved in the process of production and distribution of the goods and services

To distinguish between operations Now, we are analysing the 4V’s of an Tesco operation






Tesco operations depend on number of product and services. Customer turnover is high in Tesco as compared to the smaller shop because of the price difference as Tesco offers less price. Tesco purchase goods in bulk quantity, buying in bulk means get price discount and reduce the unit cost. Whereas small shops do not buy in bulk and unit cost is increase. So the volume in Tesco is higher compared to smaller stores.


Tesco is dealing with different types of product and services variety. Operation process of Tesco is standardized, So the variety is medium to low. Guide line is provided to all staff members and it is mandatory for the staff to follow that guide lines. Different variety of services is provided to customers such as small size trolleys, customer assistance and billing.


Mainly Tescos is located near the residential areas, and depend mainly on the food and food is essential for everyone. But there may be fluctuation in demand at a time of Muslim Eid, Christmas, Easter, halloen. So Tesco may meet higher use of resources, low unit cost and predictable amount of demand.


Visibility means provide information to the customers. Tesco some operations are visible such as front desk officer, customer assistance, billing the purchased goods and promotions. Bus some operation are not visible such as supply chain management, Inventory management etc

Objective of the Operations Management.

The main objective of the operations management is to create a balance between the cost and revenue to achieve the maximum operation profit as well as at the same time provide a good quality of product and services. Operation management involve the activities that are used in the process of production and distribution of goods and services.


A service is the product of the interaction between a provider and a client or the client’s facilities, in order to relieve the client of a problem, or to enable him to resolve it in a satisfactory manner.

In front of Customer, Tesco is known for its "TESCO Price" and its marketing campaigns. Tesco main motive is to provide the good quality product with low prices as possible to make it customer happy and to compete the market.

Tesco has been able to expand so much so that it offers an online retailer. On internet mainly all the products is available for the customers. Tesco finance department is also available and its also offer insurance policies for cars, homes and personal good and also offer the mortgages and loans.

TESCO offers 5 to 10 percent lower price than the market average. Its means that Tesco offers low price product and its aims to increase profit by sales volume. This mean Tesco believe to increase customer bank to enhance it sales volume by offering low prices


TESCO involves those activities in which efficient performance i.e. quality, speed, dependability, flexibility and cost can be measured and effectiveness of strategies (Slack et al. (2004) Operation Performance Objective, 2013) i.e. As far as quality is concerned all Tesco stores are clean and tidy. Decor is appropriate and attractive. Goods are in excellent condition. Staffs are well-mannered, friendly and cooperative. Tesco aim is to provide the high quality products

As far as speed is concerned, Tesco is trying to minimize the total time of purchasing in supermarket. All products and goods are immediately available. As far as dependability is concerned Tesco has its expected opening hours. Quantity of goods out of stock kept to a minimum. Keeping to practical queuing times. In Tesco we can find a proper parking. As far as flexibility is concern Tesco aim is to introduce new lines. Variety of stock is available. Tesco has ability to adjust the number of customer served. Tesco has capacity to get out-of-stock items. As far as cost is concerned, Tesco has technology and facilities cost, staff cost and bought in materials and services cost.


"The process by which some functional requirement of customer is satisfied through the shaping or configuration of the resources and/or activities that compose a product, or a service or the transformation process that produces them." (N Slack, S Chambers and R Johnston Operations Management, 6th Ed, Prentice-Hall, 2010)

In simple word we can say that Product and service design are those method in which idea is generated by the management or the employees, mostly by the group of designer innovating any new product on a regular interval to meet the requirement of customer and satisfying through shaping or configuration of the resources and activity which compose a product or a services or the transformation process that produces the product at any interval of time to meet the needs and demand of a product by the ultimate user. Tesco is providing wide variety of product and services. Which include, fresh fruit, groceries, Tesco direct, Clothing, Tesco Club card, Tesco bank, and Tesco petrol pumps (Tesco Products, 2013). If we talk about Tesco bank they will provide a insurance, mortgages, credit card, travel insurance and many more. (Tesco Bank, 2013). As well s Tesco club card offers which gives points on every transaction. And after 150 points customer gets a £ 1.50 vouchers. (Tesco Club Card, 2013) Tesco offers clothing for mans, women’s and children’s. Also school uniforms, shoes perfumes & different brand products are also available. (Clothing, 2013)

Operations Planning and Control

Operation planning and control are an important part of the organisation. Planning is a formalisation of what is intended to happen at some time in the future. And control is the process of coping with changes in these variables (Slack et al., 2004).


Capacity Planning and control reconciles the required availability for an operation's products and services with the operation's capacity to deliver those (Slack et al., 2004). Capacity linked mainly with, machines, manpower, and supplies of the organisation and all of these are main resources where planning and control is service.


Two managers is working in Tesco

Store Manager

Service manager

And also there is number of employee are working in Tesco. Tesco work hard to make their staff trained and provide appropriate knowledge. Also Tesco give confidence to their staff to become part owners of the business and share in the success. Also Tesco offers employees a discounted price on shares. (Tesco Shares)


Tesco do business with almost 2,000 own-brand key suppliers from 98 countries. The supply chain is consisting of relationships – from farmers and growers through to processors, manufacturers and distributors but mainly depend on local distributor. the total number of supplier from all over the world is 3000. (Tesco Plc, 2013)



Supply chain management is concerned with managing the flow of materials and information between the operations which form the strands of 'chains' of a supply network (Slack et al., 2004). Supply chain management desires believe and satisfy end consumers.

The existing Tesco supply chain system is well known (IGD, 2003b). The operations performance is now much more thoroughly monitored, mainly from beginning to end the 'steeling wheel' approach common throughout Tesco. Any division centre steering wheel focuses on operations which include protection and competence, persons which include appointment, expansion, commitment and values, finance which include stock results and operating costs, and the customer which includes exactness and delivery on time (Fernie and Sparks, 2004). Also Tesco determine these performance at all levels and maintained the quality standards and try to enhance.


Quality planning and control seeks to deliver products and services at their required specification or above it (Slack et al.2004). The procedure views quality is constant conformance to customer's hope. Quality is seen as being so vital by most operations (Slack et al., 2004).

Tesco ask the suppliers to fulfil with their Nature's choice scheme to guarantee their fruit, vegetables and salad are developed to high safety, quality and environmental standards. Also Tesco first choice is to provide the customer fresh and safety and quality seafood and organic foods. Tesco is dedicated to purchase timer and timber products only from legal, sustainable sources (Tesco Plc,2005).



Operation strategy of Tesco is long term goal. Operational strategy is very important for Tesco because Tesco offers types of services and goods to establish its target market and how Tesco compete its competitors. Tesco prepared superior control and planning in its capacity, quality and supply chain. Also Tesco measures quality, speed, dependability, flexibility and cost. In past few years Tesco made some improvement but still there is plenty of space to cover as per operations.

Tesco is the fastest growing supermarket in UK and it has change the overall retail industry, Cost and flexibility is the two main winning factors for Tesco operation.